Important Aspects of a Free Market

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Discuss some important aspects of the free enterprise system or capitalism. Three essential principles of capitalism are: production is organized for the market, the means of production are privately owned, and investment is privately controlled, and the people who use those means of production to produce goods and services, that is workers, are hired on a labor market to work in firms as employees. Capitalism is a form of market economy in which production and investment are privately controlled, and the work of production is performed by employees, hired from free labor markets. Capitalism is essential to the function of society due to the opportunities that it creates and the augmentation of an individual’s vitality. Individuals can…show more content…
One could say, this is libertarianism, where individual freedom is the paramount social value, where freedom is determined by your own volition. Economics is simply incentivized behavior, the issue with this is, when money becomes the incentive, does everything else go out the window? As we saw in the Great Recession how the sub-prime loans fiasco rippled through our economy and eventually the world. As we can see, there are positive and negative aspects of free enterprise, yet I feel that hope and inspiration of the potential to be able to augment ones vitality is essential in maintaining social order, keeping society efficient, and excelling forward. I want to be clear; I do not view the United States as a free enterprise. I believe most aspect are, but when more than half of the total output of the country is being distributed in a way that is determined by the government, the term collectivizing or Keynesian economics is more appropriate. As Dr. Friedman states, “"Everybody knows that the way to develop and to improve the lot of people is through private markets, free enterprise and small government. We're not practicing what we should be preaching. I've been saying that the former communist states are trying as hard as they can to go where we were 50 years ago; whereas we're trying as hard as we can to go where they were 10 years ago." References: Watkins, James. Pros and Cons of Capitalism. Hubpages. Aug. 2010.
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